Guardian – The City operated like a “giant hedge fund” in the runup to the financial crisis, and the resulting crash could leave the British economy with permanent low productivity and stagnant earnings, according to a senior Bank of England official.
Charlie Bean, the Bank’s deputy governor responsible for monetary policy, added that the UK’s foreign investment hot streak had cooled and was unlikely to fully recover. A shrinking surplus on investment income from abroad could spook markets and trigger a sharp fall in sterling, he said.
